Why We Had to Be a B Corp

It was a thrilling moment for our small start-up when we were notified last week that our company had been certified as a Pending B Corporation (Pending because we haven’t been operating for 12 months). In its broadest sense, this means that we are committed to the goal of being ‘best for the world,’ not simply ‘best in the world.’

The B Corporation structure isn’t the only option for companies that want to have a positive impact on the world. We chose it because we are impressed with the rigor of the B Corp Assessment. It’s objective. It makes our commitment more than a feel-good gesture. It holds us accountable.

We’ve made commitments to people (our employees, customers, and communities) and the planet (energy, water, solid waste), above and beyond the profit we have to earn to stay in business and fuel our growth. These commitments may add to the normal odds against a start-up, but the motivation that led us to start Sustainable Business Partners led naturally to joining the B Corp movement.

Don’t Be Evil

Some people laugh when they hear Google’s dictum, ‘Don’t be evil.’ We embrace it. Consider this quote from one of the earliest prophets of sustainable business (Paul Hawken in “The Ecology of Commerce”):

“When cattle ranchers clear rain forests to raise beef to sell to fast-food chains that make hamburgers to sell to Americans, who have the highest rate of heart disease in the world (and spend the most money per GNP on health care), we can say easily that business is no longer developing the world. We have become its predator.”

Business as predator? Is he kidding? Overstating the case?

Consider mountaintop-removal coal mining – mountaintops are literally blown off and dumped in nearby rivers in order to mine the dirtiest fossil fuel known. Or the two million West African children who work today as forced labor harvesting cocoa to make our chocolate. Or the bankers who almost destroyed our economy in 2008 and walked away with huge bonuses, while their customers went bankrupt.

If you read the news, you can surely name a dozen other examples without even thinking very hard. The solution isn’t to junk capitalism. It has too much to offer.

But it’s time for capitalism to grow up.

Some laugh when they hear Google’s dictum, ‘Don’t be evil.’ We embrace it.

It’s Just Us

Having recently formed Sustainable Business Partners, it’s clearer than ever to us that a company is just an empty container designed to gather and grow resources – financial, intellectual, and human resources – organizing them to produce specific products and achieve specific goals. There is nothing inherently good or evil about it. It’s just us … which, of course, is the problem. Business people with different levels of maturity have different concepts of business, and they create different kinds of companies.

The Zero-Sum Game

The least mature concept of business sees it as a zero-sum game. President Trump, for example, seems to see business (and life?) as primarily a deal-making activity. When you get a deal done on the most favorable terms for your company, or country, you’re a winner. The party on the other side of the table is – you guessed it – a loser.

The zero-sum mindset assumes that someone else has to lose for you to win. This is the language Trump uses. The idea of a ‘win-win,’ the idea that we’re all in this together – in other words, the goals a leader should be aiming to achieve – seem foreign to him.

How his deals impact others … ? In the deal-maker’s view, that’s someone else’s problem.

The Trickle-Down Economy

In the traditional view of capitalism, a company’s only goal is to maximize profit over the next quarter or the next year – other goals are considered distractions. If a company does well, its employees will eventually also do well, as will their families and communities. They benefit as a secondary effect of the owner’s success. This is the “trickle-down economics” of the Reagan era.

While this view is more complex than the zero-sum game of the deal-maker, traditional managers don’t see people, communities, and the environment as their primary concerns. Economists like Friedman call them ‘externalities.’ Which is just another way of saying, ‘not my problem.’

B Corporations

B Corp managers recognize that their companies’ impacts on other people, communities, and the environment are not secondary to their profit goals. In fact, making a profit is a valid goal BECAUSE it enables the organization to improve people’s lives and the environment.

‘Not my problem’ capitalism created today’s social and environmental stresses; a more mature form of capitalism is needed to solve them. We don’t believe in externalities, because we all live in the same neighborhood – Buckminster Fuller called it Spaceship Earth.

A willingness to own these complexities is the sign of a mature business. Does this make success more challenging? Of course it does. But anything short of this ambition is not enough anymore.

The B Corporation Declaration of Interdependence states that we must “act with the understanding that we are each dependent upon another and thus responsible for each other and future generations.” This insight led us at Sustainable Business Partners to develop a business model based on collaboration among like-minded companies. We are using the incredible power of the for-profit company to create an intentional economy that works for all – not the accidental, trickle-down economy of the 20th century.

Now the real work begins. We have 12 months to operate according to the principles we established, 12 months to accelerate the shift to a clean economy, 12 months to prove our value to sustainable companies. Then, assuming we have lived up to the B Corporation standards, we can drop the “Pending” designation. It will be fun. Join us!